Now available on the ASX – Betashares Australian Major Bank Hybrids Index ETF (ASX: BHYB)

The Betashares Australian Major Bank Hybrids Index ETF (ASX: BHYB) is now available on the ASX.

BHYB offers cost-effective, passive exposure to a portfolio of hybrid securities issued by the four largest Australian banks.

BHYB provides investors with:

• Attractive tax-efficient income
  BHYB pays income monthly at a rate expected to be significantly higher than cash and senior bonds, along with franking credits
• Portfolio diversification
  Hybrids historically have exhibited low correlation to equities as well as generally shown defensive characteristics during market declines
• High quality exposure
  To be eligible for inclusion in the index BHYB aims to track, a hybrid security must be issued by one of Australia’s ‘Big 4’ banks, and have a market capitalisation of at least $100 million
• Cost-effective exposure
  BHYB aims to track the performance of an index, so there are no ‘active manager’ fees

Investing in a hybrid security fund, as opposed to individual hybrids, has several benefits, including:

• Portfolio diversification – Investing in a hybrid security fund offers diversified exposure to a spread of hybrids, rather than having to research and choose a couple of individual hybrids only
• Issuer diversification – Investing in a hybrid security fund means diversified exposure to a range of issuers
• Liquidity – May benefit from access to superior liquidity compared to directly held hybrids
• Simplicity – Hybrids are quite complex securities with varying terms and conditions. Investing in a hybrid security fund may be suitable for investors who lack the expertise or time to evaluate whether than individual hybrid suits their investment objectives